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SCF Senegal Pilot

The adoption of the Paris Agreement (PA) in December 2015, has changed the future policy landscape for Ci-Dev and its partners. The emergence of the new market mechanisms under Articles 6.2 and 6.4 of the Agreement brought new challenges of transitioning from the Kyoto market landscape to the Paris carbon markets after 2020. With the closure of Ci-Dev on December 31, 2025 and purchase of Certified Emission Reductions (CERs) from programs beyond 2020, the important strategic question becomes how will these CDM programs continue generate CERs and will they do it at all. If so, what is the best way to transition to the Paris framework and how to effectively adapt the new market mechanisms.

Overview

ASER’s rural electrification program uses a concession-based model where private companies compete for and win the right to sell, install, and maintain new electricity connections to rural households in one or more of 10 regional ‘concessions’, during a period of 25 years. To facilitate electricity access for poor rural households, ASER has decided to use the carbon revenues to overcome financial access barriers. For this purpose, the project uses an innovative voucher scheme, and each voucher can be redeemed by the household to the private concessionaire in their territory for the service level and connection technology that best fits their needs. The concessionaire then installs the new connection and redeems the voucher with ASER for compensation. This subsidy is ultimately paid for by Ci-Dev for the generated emission reductions.

Ci-Dev signed an emission reduction purchase agreement (ERPA) with ASER on December 20, 2016. This ERPA committed Ci-Dev to purchase 660k certified emission reductions (CERs) generated through end CY2024 from the rural electrification program.